October 25, 2016

New York State: Still the Worst For Small Business

Andrew Cuomo

Politicians like to profess their support for business, especially small business. But their claims don’t always stand up to careful scrutiny.

Take Gov. Andrew Cuomo’s recent claim that his administration is doing everything it can to reverse the “perception and reality” of New York as an anti-business state.

In an op-ed at Syracuse.com earlier this month, Cuomo wrote:

We’ve begun to reverse that trend with a fiscally responsible financial plan, which includes the Property Tax Cap, the largest middle-class tax cut in 60 years, and limiting state spending to 2 percent.

Among other accomplishments, Cuomo mentioned:

  • New York Open for Business, a $140 million ad campaign that tries to portray the state as a great place to do business.
  • 10 Regional Economic Development Councils created by Cuomo to plan for economic development and spending so far more than $1.5 billion for job creation and community development, and
  • The NYSUNY 2020 initiatives, including an $80 million capital investment plan for the state’s universities.

More Spending Instead of Tax Cuts

This year, Cuomo also says the state will create a $50 million venture capital fund to invest in commercialization of technologies developed in the state’s research institutions. The governor also recently signed into law a new Tax Free NY initiative.

No, this doesn’t mean there aren’t any more taxes in New York state. The new law creates special zones around state university campuses where businesses will pay no taxes for the next 10 years.

The problem, observed the New York Post recently, is that the governor and the state legislature still haven’t cut the state’s bloated $143 billion budget. And they say they can’t lower personal income tax by even 1 percent. In fact, as the Post reports, Cuomo actually raised the top income tax rate almost two percent.

Where Things Stand

In 2011, the Tax Foundation, a non-partisan Washington D.C.-based research group, found New York state to have the worst tax climate for small business in the U.S. And the foundation’s latest index in 2013 shows nothing has changed.

Politicians seem to think that added state funding grows businesses. But small business owners know only cutting taxes and spending can do that. Below is an ad from the state’s New York Open for Business campaign. Knowing what you know about New York state’s tax laws, would you open a business there?

Gov. Andrew Cuomo Photo via Shutterstock

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Shawn Hessinger - Editor

Shawn Hessinger Shawn Hessinger is the Executive Editor for Small Business Trends. A professional journalist with more than a decade of experience in the traditional newspaper business, he has another 10 years of experience in digital media for trade publications and news sites. Shawn has served as a beat reporter, columnist, editorial writer, bureau chief and eventually managing editor with responsibility for nine weekly newspapers, the Berks Mont Newspapers.

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4 Reactions

  1. This stat is surprising considering they are so big to growing culture. I wonder how long this takes to adjust.

  2. No way in hell would I ever consider NY as a great place to do business. Instead of spending more money to promote a highly regulated and taxed out the a$$ state, why don’t they use that money to lesson the burdens it puts on business owners looking to start up shop their?

  3. Shawn,

    Well, it seems that small businesses need to continue to innovate – with or without the support from the Government.

    Here’s a good example: Rob Kaufelt of Murray’s Cheese (flagship store in Lower Manhattan) has done well because he focuses on innovation (here’s his success story: http://wp.me/p3uQZR-5Z )

  4. Gotta tell ya, I have been in trucking for along time here in New York State and New York base companies CAN NOT compete with out of state companies. One the Workers Comp in out of control. All the property taxes, employment taxes ect. You cant even get a nice person on the phone that works for New York State.
    They are all over paid and under worked. They should try running it like I have to run my business. They would not last one year. I can’t afford to give my employes benefits because of all the extra taxes and cost of doing business. But they make sure they get a raise and health insurance on our dime. Just the fuel cost alone here in New York is doulble. My advice is to run south or out west. Don’t open a business in New York State. Your Dommed before you start.

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